USD/CAD Price Forecast January 16, 2018, Technical Analysis
The United States dollar drifted a little bit lower against the Canadian dollar, breaking below the 1.2450 level. By doing so, it looks likely that we will go hunting the 1.24 level underneath, and then possibly the 1.2350 level. A fresh, new low is a very negative sign and should send this market down to the 1.20 level. Alternately, if we can break above the 1.25 handle, then I think the market will make another attempt to rally. However, I think that this pair is going to be difficult to trade, because we have several different moving pieces at the same time.
The Canadian economy is heating up, but at the same time there is a major housing bubble in the Greater Toronto Area. That is a disaster just waiting to happen, and could be negative for the Canadian dollar. At the same time, Canada has a strong economy but need to worry about whether NAFTA will exist soon. Alternately, the US dollar has been falling drastically, but at the same time oil markets – although bullish – look vulnerable to downward pressure, especially considering that Russia is talking about leaving the OPEC production cuts. In other words, I think this is probably going to be one of the noisiest pairs over the next couple of months. I would believe that it’s probably easy to short rallies on smaller time frames, but beyond that this is can be a difficult market.
USD/CAD Video 16.01.18
This article was originally posted on FX Empire